Who Pays for Bank Resolution? The Size of the Deposit Guarantee Schemes within the EU Crisis Management and Deposit Insurance Reforme

Lorenzo Di Toro
Roberto Di Pietra
Pierre Di Toro

01/11/2025

Within the EU debate on the Crisis Management and Deposit Insurance (CMDI) reform, the article demonstrates the inadequacy of Deposit Guarantee Schemes (DGS) for the eurozone’s covered and non-covered deposits, in view of the 8% bail-in threshold enabling access to the Single Resolution Fund. To this end, it introduces – by bank size – a model decomposing balance sheet liabilities to determine the insufficiency of DGS in protecting non-financial corporations and households. The results prove the necessity of extending the scope of DGSs in bank resolution according to the CMDI reform proposed by the European Commission in April 2023.

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